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Monday, 8 May 2023

What We’re Tracking Today
M&a Watch
Advisory
Economy
War Watch
Moves
Last Night’s Talk Shows
Egypt In The News
Also On Our Radar
Planet Finance
Around The World
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Calendar

Seven days until the Enterprise Exports & FDI Forum

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Today at a glance

1

WHAT WE’RE TRACKING TODAY

 Seven days to go: Here’s who’s speaking at the Enterprise Exports & FDI Forum.
2

M&A WATCH

 Ezz Steel looks to acquire gov’t-owned shares of Ezz Dekheila Steel.
3

ADVISORY

Egyptian consultancy Lynx partners with Dentons Global Advisors-ASG.
4

ECONOMY

 JPMorgan expects an IMF review in June, but warns on medium-term debt outlook.
5

WHAT WE’RE TRACKING TODAY

 Gov’t to raise public investments by 56% in FY 2023-2024.
6

ALSO ON OUR RADAR

 Egypt Education Platform + Modon Developments to open new British school in Alex.
7

ALSO ON OUR RADAR

 ODE shareholders approve loan for El Gouna expansion.
8

WHAT WE’RE TRACKING TODAY

 Syria is back in the Arab League following a 12-year absence.
9

BLACKBOARD

 Egypt now has an electronic portal for higher education equivalency certificates.

Monday, 8 May 2023

What We’re Tracking Today
M&a Watch
Advisory
Economy
War Watch
Moves
Last Night’s Talk Shows
Egypt In The News
Also On Our Radar
Planet Finance
Around The World
Blackboard
Calendar
1

WHAT WE’RE TRACKING TODAY

Here’s who’s speaking at the Enterprise Exports & FDI Forum

Good morning, wonderful people, and happy Monday. We’re going to start this morning’s program with a quick housekeeping announcement:

We’re only one week away from meeting with some of you at the Enterprise Exports and FDI Forum, taking place at the Four Seasons at the Nile Plaza on Monday, 15 May.

We’re delighted to have some exceptional speakers lined up — setting the stage for a fascinating day and for some great post-event editorial coverage.

If you’re attending, make sure to come early: Our networking breakfast starts at 9am, and it’s your chance to catch up with friends and colleagues as well as our speakers.

Speaking of speakers: We’re delighted that McKinsey partner Yassir Zouaoui is coming in from the GCC to join us for our opening panel, which we’ll unveil tomorrow. Yassir, a specialist in FDI with hands-on experience in Saudi Arabia, Dubai and Morocco, will join two other special guests to help us set the tone for the day in an on-stage interview by HSBC Egypt Deputy CEO Helmy Ghazi and Patrick, our editor-in-chief.

Then it’s off to the races, with an A-list lineup of speakers that includes:

They’re not the only ones: Among the CEOs, top execs, bankers, and development finance folks speaking at the conference are (in no particular order): Tarek Kamel, CEO of Nestle Egypt; Omar Elsahy, General Manager of Amazon Egypt, Khaled Morsy, CEO of DB Schenker Egypt; Mark Wylie, CEO of Beyti; Mohamed Talaat Khalifa, CEO, Concrete; Kareem Abou Ghaly, chairman and CEO, Pasta Regina; Tarek Hosny, head of investments and projects at Fertiglobe; Nadia El Tawil, investment officer, AfricInvest; Mostafa Bedeir, CEO, Giza Seeds and Herbs; Hassan Massoud, associate director and head of private equity (Southern Mediterranean), European Bank for Reconstruction and Development (EBRD); Hossam Abou Moussa, partner at APIS; Shady William, managing director of IDG; Nada El Ahwal, CSO of Transmar, Mohamed El Gebely from USAID Trade; Hossam Sallab, CEO and vice-chairman, Sallab Group and Royal Ceramica; and Abdallah Sallam, CEO, Madinet Masr.

Topics and live interviews will include:

  • Why exports and FDI are the way forward — and what lessons we can learn from what’s worked in Morocco, Vietnam, Saudi Arabia and beyond;
  • How to attract the right foreign partner — and how to figure out what they’re looking for;
  • What lessons we can draw from export success stories in white goods, fertilizers, and garments;
  • What are the fundamentals to creating an export and / or FDI strategy;
  • What it takes to secure a place in a multinational’s supply chain;
  • What are the industries of tomorrow if you’re starting your FDI and / or export strategy from scratch.

Tap or click here to explore our full agenda.

** Have you confirmed your attendance? Invitations have been sent out over the past few weeks. If you have yet to confirm your attendance and would still like to join us, please reply to the invitation with an RSVP.

THE BIG STORY IN THE REGION-

Arab foreign ministers yesterday voted to bring Syria back into the Arab League 12 years after it was kicked out for its crackdown on Arab Spring protesters, according to a statement (pdf) out following the meeting in Cairo. Damascus is now allowed to attend meetings and it has been suggested that the country’s president, Bashar Al Assad, could chair the next gathering on 19 May.

Calls to end the war: The decision included a call by Arab states to reach a political settlement to the war in Syria and address issues such as refugees, terrorism and drug trafficking. Egypt, Saudi Arabia, Jordan, Iraq, Lebanon, and the Arab League's secretary-general will set up a group that will work with the Syria government to end the conflict.

Regional realignment: The vote follows weeks of talks among Arab diplomats to readmit the country back into the league and reestablish bilateral ties. Since the devastating earthquake that struck Syria and Turkey in February, Egypt and Saudi Arabia have led efforts to mend ties with Damascus and bring it back into the regional fold. It comes as part of a wider regional realignment that has seen Saudi Arabia rebuild ties to Iran and Cairo and Ankara start to make up as well.

Coverage is everywhere in the global press: Reuters | Associated Press | Bloomberg | Financial Times | NYT | BBC | Wall Street Journal.

HAPPENING TODAY-

Shoukry in Chad + South Sudan to talk Sudan ceasefire: Foreign Minister Sameh Shoukry is in Juba and N’Djamena today to discuss bringing the three-week-long conflict in Sudan to an end, the ministry said in a statement yesterday. We have the updates on the conflict and the negotiations in Saudi Arabia in this morning’s War Watch, below.

The CFA Society is hosting its investment and sustainable finance day, featuring a variety of speakers from the International Finance Corporation, CI Capital, and the Financial Regulatory Authority’s Mohamed Farid.

Today in the Senate: Senators look into a report supporting the use of e-books in Egyptian universities.

HAPPENING THIS WEEK-

Tomorrow is budget day at the House: Finance Minister Mohamed Maait and Planning Minister Hala El Said will deliver statements in the House for the draft FY 2023-2024 budget. This will kickstart a month of discussions at the House Budget Committee before the final budget heads to the general assembly for a final vote before the end of the fiscal year on 30 June.

You can expect lots more government spending in the next fiscal year: The Finance Ministry has proposed allocating EGP 586.7 bn to what it calls public investments for the coming fiscal year, up 56% from FY 2022-2023, according to a new budget report.

Health and education spending to rise: Allocations to education will rise 19% to EGP 305.2 bn in FY 2023-2024 while health spending will increase 14% to EGP 111.2 bn, according to the report. The government is constitutionally required to spend a total of 10% of GDP.

The House Budget Committee has a busy week ahead, with six meetings scheduled until the end of the week, Mostafa Salem, deputy chairman of the House Budget Committee, is quoted as saying by Al Mal. The committee has two meetings scheduled for tomorrow, Wednesday, and Thursday to discuss the state budget and the draft budgets for various state agencies for FY 2023-2024.

FYI- Here’s what we know so far about the budget and the state’s fiscal targets.

ALSO- UN sustainability agreement tomorrow: The Madbouly government and the UN will ink the UN Sustainable Development Cooperation Framework for 2023-2027, according to MENA. The framework will guide the implementation of UN projects in Egypt over the next four years.

AND-The Swedish embassy is hosting an event in Cairo on the prospect of hooking our electricity grid up to Europe’s, paving the way for significant energy exports.International Cooperation Minister Rania Al Mashat, Oil Minister Tarek El Molla, and representatives from the key private-sector infrastructure players working on Mediterranean energy projects will take part in panel discussions. The European Investment Bank and Alexbank will ink an undisclosed contract during the event, which comes as Egypt

SOUND SMART- There are as many as five proposed interconnector projects that would link our electricity grid to mainland Europe. Read about them all here.

HAPPENING NEXT WEEK-

The National Dialogue begins: The first session of the National Dialogue will take place on Sunday, 14th May with the second and third sessions happening on Tuesday and Thursday. Sessions will take place every Sunday, Tuesday and Thursday.

Car import scheme wraps up: The expat car import initiative will draw to a close on 14 May. The scheme was initially scheduled to end in mid-February but was extended for another three months in a bid to maximize FX inflows.

REFRESHER-Launched in November, the scheme provides incentives to Egyptians living abroad to purchase cars overseas and import them into Egypt. It was designed by policymakers to bring more FX into the country. FinMin’s latest tallyin mid-April put the total FX raised by the scheme since its launch at USD 500 mn — 80% short of the government’s initial USD 2.5 bn target.

FACT CHECK- Gold and aluminum will not be making their EMX debut this year, EGX comms head Hesham Turk told Ahram Online yesterday. Turk was responding to a report in the local media this week that cited anonymous officials claiming the exchange would launch both commodities later this year.

When can we expect the EGX to start sharing gold prices? “We will include gold prices on our website once we obtain the approval of the Financial Regulatory Authority. A state-owned gold refining plant will provide the price updates,” he said. EGX boss Ramy El Dokany said last week that the EGX will start sharing gold prices on its trading screens within days.

DATA POINT #1- The Madbouly government has purchased 1.3 mn tons of local wheat since the local harvest season kicked off last month — taking it a third of the way to reaching its 4-mn-ton target, Kamal Hisham, head of the General Company for Silos and Storage, said in a televised interview yesterday (watch, runtime: 8:05). The harvest season began in April and runs through to August. Last year the government procured around 4.2 mn tons of wheat from local farmers, missing its ambitious 6-mn-ton target.

REMEMBER- The government is paying a lot more for local wheat, recently hikingitspurchase price by 74% to EGP 1.5k per ardeb.

DATA POINT #2- Global food prices rose 0.6% m-o-m in April, while falling 19.7% y-o-y as prices continue to decline from last year’s record highs, according to the UN food price index. The slight upward trend in April was due to increases in the prices of sugar and meat. Cereals, dairy, and vegetable oil prices dropped, continuing a downward trend.

ICYMI-

Missed this week’s Inside Industry? In our weekly vertical exploring all things industry and manufacturing, we looked at what the private sector wants to see in the redrafted Labor Act.

CIRCLE YOUR CALENDAR-

IT’S OFFICIAL- Egypt is hosting the World Urban Forum in 2024: The Madbouly government and UN-Habitat inked an agreement to kickstart the Egyptian preparations to host the biannual World Urban Forum in 2024, according to a cabinet statement.

Tour de France’s L’Etape is coming to Egypt: Tour de France’s amateur cyclists' event — dubbed L’Etape — will host its first cycling race in Egypt later this year in Sharm El Sheikh, according to a statement (pdf). The event will happen under the auspices of the Youth and Sports Ministry.

Interested? The event’s date and registration details will soon be posted on L’Etape Egypt’s instagram page.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

*** It’s Blackboard day: We have our weekly look at the business of education in Egypt, from pre-K through the highest reaches of higher ed.

In today’s issue: The Higher Education Ministry has launched an electronic portal for students to receive equivalency certificates, with the services available for all graduate and postgraduate degrees and across all areas of study.

The World Aquatics Festival at Somabay: Three remarkable aquatic tournaments will be held together for the first time in Egypt, presented by the World Aquatics Federation and the Egyptian Swimming Federation in partnership with Somabay. Prepare yourself for the action. 8-9 May: Open-Water Swimming World Cup. 13-15 May: Artistic Swimming World Cup. 12-15 May: World Beach Water Polo Qualifiers.

2

M&A WATCH

Egypt’s Ezz Steel in talks to acquire gov’t-owned shares of Ezz Dekheila Steel

State to sell down ownership in Ezz Dekheila steel? Ezz Steel is in negotiations to acquire 14% of its EGX-listed subsidiary Ezz Dekheila Steel from two state institutions, a government source confirmed to Enterprise after the news was first reported in Asharq Business.

The sellers: The National Investment Bank (NIB) and National Bank of Egypt (NBE) could both sell their stakes in the company to Ezz Steel. The NIB owns 8.1% of Ezz Dekheila Steel while the NBE owns 5.7%.

A nine-figure transaction: The acquisition would be worth some EGP 2.5 bn based on Ezz Dekheila’s opening price yesterday morning before news of the transaction broke. The stake sale could be completed before the end of the month, Asharq’s sources said.

The market likes the transaction: Shares in Ezz Dekheila closed 3.6% up at EGP 955.25 at the end of trading on Sunday. Shares in Ezz Steel closed 4.1% up at EGP 41.70.

Ezz Steel would control more than three-quarters of the company: The steelmaker currently owns 64% of Ezz Dekheila Steel, with the remainder in freefloat.

The state would retain significant minority ownership:Other state institutions, including pension funds, Banque Misr, Misr Ins. and the Egyptian General Petroleum Corporation, hold about 17.2% of the company, according to the company’s most recent financials (pdf).

THE BIG QUESTION- Does this foreshadow other stake sales by NIB? The bank is looking to offload a substantial number of the minority stakes it owns in other state-owned companies, our source says. The fresh capital raised could be used to restructure the companies, they added.

REMEMBER- Prime Minister Moustafa Madbouly’s government wants to sell assets worth USD2 bnby June as part of its plans to privatize at least 32 state-owned companies over the next year. Ezz Dekheila Steel was not included in the initial list of companies.

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3

ADVISORY

Egyptian consultancy Lynx partners with Dentons Global Advisors-ASG

Lynx announces partnership with Dentons Global Advisors-ASG: Egyptian consultancy Lynx Strategic Business Advisors has entered a “strategic affiliation” with global strategic advisory firm Dentons Global Advisors — Albright Stonebridge Group, the firms said in a joint statement (pdf) last week.

Dentons Global Advisors-ASG? It’s a global advisory firm that provides strategic counsel for clients on commercial, reputational, financial, regulatory and governance issues. The firm was launched in 2021 as the advisory arm of global law firm Dentons in partnership with Albright Stonebridge Group.

What they said: The partnership will support Lynx’s efforts to increase private-sector participation in the local economy, support economic growth and attract new foreign direct investment into the country, Managing Director Mohamed Hanafi said ina statement (pdf).

Several of Lynx’s senior managers are joining Dentons: Lynx Managing Partner Ambassador Waguih Hanafi (bio), Managing Director Mohamed Hanafi (bio) and Senior Advisor Karim Haggag (bio) have all joined Dentons as senior advisors, according to the statement.

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4

ECONOMY

JPMorgan expects an IMF review in June but warns on Egypt’s medium-term debt outlook

JPMorgan is the latest investment bank to warn of the consequences of delaying reform: Further delays to currency and structural reforms will ramp up liquidity pressures and raise questions about the sustainability of Egypt’s debt, analysts at JPMorgan wrote in a note last week. The investment bank said that while a near-term default isn’t in the cards, the recent sell-off in Egyptian bonds indicates growing anxiety about the medium-term outlook, especially with the heavy debt repayment schedule over the coming years.

The good news:The bulge bracket stalwart thinks Egypt should be able to seal a staff-level agreement with the IMF next month, putting us on course to getting board approval and the next loan tranche by the third quarter. Each review requires Egypt and the IMF to reach a staff-level agreement, which is then taken to the executive board for approval.

Remember: Egypt committed to maintaining a flexible exchange rate and undertake a host of structural reforms — including selling down state assets and improving transparency of state- and military-owned companies — as part of its USD 3 bn agreement with the IMF. Following a sizeable depreciation during the first two months of the year, the official EGP-USD exchange rate has remained unchanged, while the government is yet to make a sale under its ambitious privatization program.

What they said: “Efforts are needed to catalyze privatization flows as their continued absence will further worsen the country’s external picture and aggravate imbalances,” the analysts wrote.

There are three ways that JPMorgan thinks this could play out:

#1- Summertime, and the living is easy: We reach a staff-level agreement with the IMF by June, paving the way to the executive board approving the review and the disbursement of the next loan tranche, no questions asked. In this scenario — to which the bank gives a 55% probability — Egypt will see FX reserves rise USD 3.2 bn both this fiscal year and the next, and trigger another USD 3.1 bn in inflows from multilateral lenders.

#2- We’ll take it: We reach a staff-level agreement with the Fund but the executive board isn’t convinced. Before signing off on the review, it asks us to push on with the reform agenda, such as selling down more state-owned assets. JPMorgan says that in this scenario — which it gives a 30% likelihood — bond prices could decline initially but won’t experience dramatic changes.

#3- Hold onto your hats: Having failed to reach a staff-level agreement with the Fund in June, there remain few signs of a breakthrough in the third-quarter. In this “more dire” scenario, the bank expects FX reserves to decline by almost USD 10 bn over the next two fiscal years and bond prices could move towards default territory. JPMorgan currently gives this only a 15% chance of happening.

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5

WAR WATCH

Sudan ceasefire talks to continue for coming days, says Saudi Arabia

Violence continues as peace talks enter third day: Clashes between the Sudanese Army and paramilitary Rapid Support Forces (RSF) continued yesterday as representatives from both sides continued “pre-negotiation talks” in Saudi Arabia. The two sides agreed to a week-long ceasefire starting Thursday, which has so far failed to hold.

Talks to continue for coming days: The US-Saudi-sponsored talks in Jeddah will continue in the coming days, the Saudi Foreign Ministry said yesterday. The meetings started on Saturday and are the first time the army and the RSF have met fact-to-face since fighting began three weeks ago. The ministry expressed hope that the process will lead to an “effective short-term ceasefire to facilitate humanitarian assistance.”

REFUGEE COUNT RISES-

Egypt has now taken in more than 61k people from Sudan since the beginning of the crisis, including 57k Sudanese nationals, Foreign Minister Sameh Shoukry saidyesterday during the Arab League’s emergency meeting on Sudan and Syria.

The number could be higher, according to Ala Mas’ouleety host Ahmed Moussa (watch, runtime: 4:59), who last night put the number at 65k, with 60.6k Sudanese nationals entering the country. Moussa’s figures are higher than any of those reported by Egyptian or international officials.

Some 86.9k Sudanese citizens had crossed the border to neighboring countries as of 4 May, according to UNHCR data. Egypt had taken in the largest number of refugees (50.5k), followed by Chad with 26k, Central African Republic (6.3k), South Sudan (2.6k), and Ethiopia (1.5k).

Shoukry reiterated solidarity with Sudan during his speech, saying that Egypt is prepared to offer all forms of support to help the Sudanese nation overcome this crisis and reiterated the need for a ceasefire.

Aid on the way: Saudi Arabia has pledged USD 100 mn in humanitarian aid, Reutersreported, citing Saudi state-run Al Ekhbariya.

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6

Moves

Egyptian credit bureau I-Score appoints new CEO and managing director

State-backed credit bureau I-Score has appointed Mohamed Karim Ghanem as company CEO and managing director,Hapi Journal reported, citing a company statement. Ghanem’s appointment is part of a larger overhaul that has brought in Banque Misr’s Misr Exchange’s Sayonara El Asmar (LinkedIn) as deputy managing director, effective August 2023.

Ghanem has more than 23 years of experience in banking. He has served as a deputy governor at the Central Bank of Egypt and previously held positions at QNB Alahli and Mashreq Bank.

Other board changes include: Current CEO Mohamed Kafafi (LinkedIn) will serve as non-executive chairman, and new board members have been appointed, including Banque Misr’s Amr Hashem (LinkedIn) and Credit Agricole’s Amir El Feky (LinkedIn).

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7

LAST NIGHT’S TALK SHOWS

Egyptian talk shows cover Syria rejoining the Arab League and the latest in Sudan

It was a diplomacy-heavy night on the airwaves, with the nation’s talking heads focusing on Syria’s re-admission to the Arab League and the latest on the situation in Sudan.

Syria’s back: The Arab League’s decision yesterday to allow Damascus to rejoin the organization — 12 years after it was kicked out for its crackdown on pro-democracy protests — dominated the talk show coverage last night, with the talking heads bringing on several diplomats and analysts to discuss what it’ll mean for the regional political order. The Arab League is hoping that the vote will be met with “positive interaction” from the Syrian side and encourage it to take steps to bring its civil war to an end, Arab League Assistant Secretary-General Hossam Zaki told Kelma Akhira (watch, runtime: 13:14).

It was only a matter of time: “Syria is a major country, one of the founders of the Arab League … Now Arab nations have decided they want to play their part in resolving the situation in Syria. They realized that keeping Syria away from the rest of the Arab nations is not useful,” Gamal Roshdy, a spokesperson for the Arab League's secretary-general, told Al Hayah Al Youm (watch, runtime: 11:45). Syria not being part of the league resulted in the lack of Arab action in response to the situation there and the repercussions of the Syrian situation are too dangerous for it to be left unresolved, he added.

There was an emotional turning point following the earthquake that hit Syria in February, veteran journalist Abdel Moneim Saeed told Kelma Akhira’s Lamees El Hadidi (watch, runtime: 11:53). “Syrians have a special place in the hearts of Arabs,” he added.

More coverage: Ala Mas’ouleety (watch, runtime: 5:52) and Masa’a DMC (watch, runtime:5:26) also had the news.

MEANWHILE IN SUDAN- Fewer people are crossing the border:The number of people crossing the Egyptian-Sudanese border is slowing, one correspondent told El Hekaya (watch, runtime: 6:32). He said that Egyptian authorities are working to provide the Sudanese crossing the border with aid.

How can Egyptian students studying in Sudan get back on track? The Higher Education Ministry will soon launch an online platform to help Egyptian students who were studying in Sudanese universities navigate their studies in Egypt, ministry spokesperson Adel Abdel Ghaffar told Masa’a DMC (watch, runtime: 3:59). There were around 5k Egyptians studying in Sudanese universities when the conflict broke out, he said.

AND- Madbouly congratulates King Charles on his coronation: Prime Minister Moustafa Madbouly passed on his congratulations to King Charles on his coronation during a meeting with UK Foreign Secretary James Cleverly in London, cabinet said in a statement. The meeting touched on British-Egyptian relations, the situation in Sudan, and British investments in Egypt.

ALSO- Checking in on the Supply Ministry’s customs-free gold scheme: You’ll be able to bring between 100-150 grams of gold into the country without paying customs fees, Nagy Farag, an advisor to the Supply Ministry on gold told El Hekaya (watch, runtime: 2:22). Supply Minister Ali El Moselhy last week announced a plan to allow Egyptians living abroad to import gold to Egypt without paying customs duties in a bid to help stabilize the gold market. “This also solves the USD crisis; gold equals USD,” Farag told show host Amr Adib last night.

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8

EGYPT IN THE NEWS

Egyptian football club sacks manager, football director for insulting board

It has been while since we’ve had a morning this slow in the foreign press: The only articles of note this come to us from Reuters, which reports on the controversial sacking of the Hassan twins (coach and football director, respectively) at Al Masry football club. Meanwhile, high-end travel magazine Travel + Leisure features a write-up about “one of the world’s most extraordinary hotels,” Siwa’s luxury ecolodge Adrere Amellal.

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9

ALSO ON OUR RADAR

Egypt Education Platform + Modon to launch new school in Alexandria in 2025. PLUS: News from Banque Misr, MaxAB, Kandil Steel, Qardy, NOSCO, Mastercard and Skoda

EDUCATION -

New British school in Alexandria: Egypt Education Platform (EEP) and Modon Developments will open the doors of a new British school in Alexandria at the start of the 2024-2025 academic year, under an agreement (pdf) the two companies signed last month. Construction of the Alexandria British Academy will start early next year in the Al Seyouf district. The school will accommodate more than 1.8k students, and will be the first in Alexandria to offer both the international primary curriculum and the British curriculum.

EEP: Is an education management firm that counts EFG Hermes and the Sovereign Fund of Egypt among its anchor investors. Formerly known as GEMS Education Egypt, it has a network of 18 schools and nurseries.

NON-BANK FINANCIAL SERVICES-

#1- Banque Misr, MaxAB partnering in MSME push: State-owned Banque Misr and e-commerce startup MaxAB inked an agreement to provide financing and digital banking solutions to small and micro enterprises in MaxAB’s retail network, according to a statement (pdf).

#2- Qardy to provide financial services to NOSCO clients: Online SME lending marketplace Qardy will offer its services to clients of the National Company for Transportation and Overseas Service Company (NOSCO) under an agreement signed with the trucking firm, according to a press release (pdf). The partnership will unlock an initial EGP 100 mn of funding for the firm’s clients, according to the statement. The companies didn’t disclose the specifics of the funding arrangements, saying only that Qardy will offer a “diversified set of financial products” allowing NOSCO’s customers to “optimize their cashflow cycles.”

#3- Mastercard has partnered with local fintech firm Egabi FSIto help companies across the Middle East, Africa, and Eastern Europe offer digital buy-now-pay-later, microfinance, and SME finance products, it said in a press release last week.

DEBT-

#1- ODE shareholders okay loan for Gouna expansion: Orascom Development Egypt (ODE) shareholders have approved a USD 30 mn loan from parent company, Orascom Development, according to an EGX disclosure (pdf). The company said earlier this year that it was looking to borrow USD 30 mn to help finance the planned expansion of El Gouna. The loan carries a tenor of 10 years and an interest rate of 3.75%.

#2- Kandil Steel could secure USD 25 mn from the IFC: The International Finance Corporation (IFC) could lend USD 25 mn to flat steel manufacturer Kandil Steel, according to the lender’swebsite. The facility would allow the company to preserve employment and maintain its capacity utilization rates, “preventing reduction in output and preserving direct value-addition to the Egyptian economy.” The IFC will announce its final decision on the loan on 19 June.

BANKING-

Housing and Development Bank has launched new three-year high-yield CDs,with an annual interest rate of 20% or a monthly interest rate of 18.5%, according to its website. The minimum deposit is EGP 100k.

REMEMBER- A handful of state-owned and private-sector banks have introduced newhigh-yield certificates of deposit in the wake of the central bank’s decision in March to raise interest rates by another 200 basis points.

TRANSPORT-

Skoda will take over the maintenance of some of our train locomotives: Czech car manufacturer Skoda will renovate and maintain our Henschel and Adtranz locomotives for a 15-year period as well as help localize the production of spare parts under an agreement it is set to sign with the Madbouly government early next month, the Transport Ministry said in a statement.

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10

PLANET FINANCE

Economic concerns raise volatility in the oil markets

Volatility in oil prices could create more … volatility in oil prices: Speculators have dumped their oil holdings as prices crash, leaving the market in desperate need for liquidity, Bloomberg reports. Investors are looking for the door after a week of declines that at one point pushed WTI crude prices as low as USD 63.64 a barrel, a low not seen since late 2021. Money managers have ditched net-bullish positions by 19%, leaving the market to “algorithm or momentum-based traders” and potentially spurring more volatility.

Contagion in the cards? “We’re not there yet, but if oil drops below USD 63, it will cascade in other markets — even stocks,” one analyst said, adding that “oil lures speculators when prices move higher. They need to see a more rational market.” Bulls will be looking for a slowdown in Russian output or a pickup in Chinese demand before they return, according to the business news outlet.

European gas prices have also dropped: The European gas benchmark fell to EUR 35.20/MWh on Friday — its lowest since July 2021 — following a mild winter and as the continent succeeds in finding alternative sources of gas and bringing online more renewable power, the Financial Times reports. That’s compared to theall-time highof EUR 350/MWh that European gas hit last summer as Russia slashed its exports of natural gas amid the war in Ukraine.

Good news for inflation? The gas price drop has some expecting that the high inflation seen in most major markets over the past year could now start to cool, leading the European Central Bank to raise interest rates by a smaller 25 bps last week after a spate of larger rate hikes aimed at curbing price growth.

Also worth noting this morning:

  • Mohamed Mansour’s Mantrac exits Russia: Egyptian business icon Mohamed Mansour’s Caterpillar equipment firm Mantrac has suspended Russian operations after Britishmedia reported it was supplying machinery to the country’s oil and gas industry. (Bloomberg)
  • Saudi growth slips in 1Q 2023: Saudi Arabia’s GDP increased by 3.9% y-o-y in 1Q 2023, down from 5.5% in 4Q 2022 (pdf), mostly due to a slowdown in the oil economy. (General Authority for Statistics — pdf)
  • US unemployment at 54-year low: The US unemployment rate dropped to 3.4% in April — its lowest level since 1969 — on the back of a sweeping hiring boom that saw some 253k jobs created. (Wall Street Journal)

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USD 28,928

+0.2% (YTD: +75.3%)

THE CLOSING BELL-

The EGX30 fell 0.4% at yesterday’s close on turnover of EGP 1.25 bn (29% below the trailing 90-day average). Foreign investors were net buyers. The index is up 18.1% YTD.

In the green: Ibnsina Pharma (+4.6%), Ezz Steel (+4.1%) and Mopco (+2.1%).

In the red: AMOC (-2.4%), ADIB (-2.3%) and Eastern Company (-1.8%).

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11

AROUND THE WORLD

UAE joins China-led Shanghai Cooperation Organization as a dialogue partner

Another MENA state joins China’s SCO:The UAE has been named dialogue partner of the Shanghai Cooperation Organization, according to the UAE Foreign Affairs Ministry. The Gulf state joins Egypt and Qatar, who joined the organization last year, and Saudi Arabia, which in March approved plans to join as a dialogue partner.

China’s Belt and Road could link up with Kabul: The Taliban could see USD bns in infrastructure funding from China after it struck an agreement with China and Pakistan to extend the initiative to Afghanistan, per a joint Chinese and Pakistani statement.

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Our weekly deep dive into education in Egypt, from K-12 to post-secondary.

Published every Monday in EnterpriseAM.

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12

BLACKBOARD

Egypt now has an electronic portal for higher education equivalency certificates

Easier procedures + more transparency: Say hello to the electronic portal for higher education equivalency certificates. The Higher Education Ministry has launched an electronic portal for students to receive equivalency certificates, with the services available for all graduate and postgraduate degrees and across all areas of study. The platform will be accessible for students who either studied abroad or at a local university that requires equivalency certificates.

The platform is already up and running, after the ministry launched it in mid-April. The original process — which required students to physically submit their paperwork to the Supreme Council of Universities office at Cairo University — has been scrapped, according to Higher Education Ministry sources we spoke with.

How it works: Students can now set up a user account on the portal to input their data, upload their documents electronically, and submit a request for the certificate they want. Online payment is integrated on the website, which also offers a follow-up feature for students to track progress on their request, as well as a form for inquiries. The website also provides a user manual (pdf) to guide the process. Once a certificate request is submitted, a specialized committee is responsible for looking into the request and verifying all appended documents.

The timeline: Once an applicant’s request is accepted and all the necessary data and documents are provided, the equivalency certificate could be issued as quickly as within a week’s time, according to Nahda University President Hossam El Malahy told Enterprise. Prior to the digital system, the process would typically take up to two months for a certificate request to be processed.

There are initial procedures that need to be followed, though: To receive the equivalency degree, students who study abroad need to follow certain procedures that the council put in place as of last academic year. Once they receive a university offer or a scholarship to study abroad, students are required to register with the Higher Education Ministry, which then monitors these students throughout the duration of their studies. Students who fail to meet these requirements will not be granted equivalency degrees, the council said.

Why is this happening now? The ministry decided to set up the electronic system for several reasons, chief among them being transparency and to build a robust database of students who studied abroad, including the degrees they received and the country in which they studied, according to our ministry sources. By using the electronic platform, the ministry will also be better able to detect fake certificates, our sources said. The system is also meant to keep up with global standards of digitization, while streamlining procedures for students.

Going digital = better oversight and unified procedures: Setting up a digital system for the process of issuing equivalency certificates will allow the process to be monitored and transparent, Badr University President Mostafa Kamal told Enterprise. Before the system went online, private universities used to provide graduation certificates and would then go through the process of documenting these certificates only when needed, while public universities sent certificates directly to the Supreme Council of Universities to be verified, Kamal said. The new system unifies the procedures for students at all universities, which will create a more organized structure, he said.

Your top education stories for the week: Egypt has been ranked 24th globally in the SCImago index for scientific publications,according to a statement from the Higher Education Ministry. Our ranking increased two places from 2021 when it ranked 26th in the world.

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CALENDAR

APRIL

Late April – 15 May: 1Q2023 earnings season.

MAY

7-11 May (Sunday-Thursday): First round of applications for sixth phase of export subsidy program.

9 May (Tuesday): House back in session.

9 May (Tuesday): Europe-Egypt Energy Interconnectivity Event, Swedish embassy, Cairo.

9-11 May (Tuesday-Thursday): First edition of the Arab Actuarial Conference, Cairo.

12-15 May (Friday-Monday): Egypt Fashion Week.

13 May (Saturday): Transport Ministry’s Maritime Transport Sector is hosting its Excellence and Creativity conference in Alexandria.

14 May (Sunday): First National Dialogue session.

14 May (Sunday): Expat car import scheme ends.

14 May (Sunday): EgyptAir to launch a new route to Dhaka, Bangladesh.

14 May (Sunday) Egytrans’ shareholders to vote on NOSCO acquisition.

15 May (Monday): Enterprise Exports & FDI Forum, Four Seasons Hotel Cairo at Nile Plaza.

16 May (Tuesday): National Dialogue session.

16-18 May (Tuesday-Thursday): Egypt will host its first conferenceon cybersecurity and defense intelligence systems (CDIS-Egypt).

17-31 May (Wednesday - Wednesday): Second round of applications for sixth phase of export subsidy program.

18 May (Thursday): National Dialogue session.

18 May (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

19 May (Friday): Arab League summit, Riyadh.

19-21 May (Friday-Sunday): G7 summit, Hiroshima, Japan.

20-21 May (Saturday-Sunday): eGlob Expo, St. Regis Almasa Hotel, Cairo.

22-26 May (Monday-Friday): Egypt will host the African Development Bank (AfDB) annual meetings in Sharm El Sheikh.

29 May (Monday): IEF-IGU Ministerial Gas Forum, Cairo.

30 May (Tuesday): Listed companies have until this date to report and publish their 1Q results.

JUNE

June: Indian representatives to discuss prospect investments in the Suez Canal.

7-10 (Wednesday-Saturday): The second edition of Africa Health Excon.

10 June (Saturday): Thanaweya Amma examinations begin.

12 June - 15 July (Monday-Saturday): Thanaweya Amma exams.

13-14 June (Tuesday-Wednesday): Federal Reserve interest rate meeting.

15 June (Thursday): Deadline for bids in EGPC’s mature oil fields tender.

19-20 June (Monday-Tuesday): The forum for insolvency reforms and corporate restructuring in the Middle East and North Africa.

19-21 June (Monday-Wednesday): Egypt Infrastructure and Water Expo debuts at the Egypt International Exhibition Center.

22 June (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

28 June-2 July (Wednesday-Sunday): Eid El Adha (TBC).

30 June (Friday): June 30 Revolution Day.

30 June (Friday): Egypt to exit Grains Trade Convention.

JULY

1 July: House of Representatives deadline to approve the FY 2023-2024 budget.

1 July: GAFI to launch the country’s first integrated electronic platform to facilitate setting up a business.

5 - 6 July (Monday - Tuesday): Gov’t to pay out subsidies to first wave of applicants under its sixth export subsidy program.

18 July (Tuesday): Islamic New Year.

19 - 20 July (Wednesday - Thursday): Gov’t to pay out subsidies to second wave of applicants under its sixth export subsidy program.

20 July (Thursday): National holiday in observance of Islamic New Year (TBC).

23 July (Sunday): Revolution Day.

25-26 July (Tuesday-Wednesday): Federal Reserve interest rate meeting.

27 July (Thursday): National holiday in observance of Revolution Day.

Late July-14 August: 2Q2023 earnings season.

AUGUST

August: Hassan Allam Utilities + Agility to open Yanmu East logistics park.

2 - 3 August (Wednesday - Thursday): Gov’t to pay out subsidies to second wave of applicants under its sixth export subsidy program.

3 August (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

10 August (Thursday): Shalateen Mineral Resources gold mining tender closes.

22-24 August (Tuesday-Thursday): BRICS summit, Johannesburg, South Africa.

SEPTEMBER

September: Sustainable Debt Coalition Initiative agreed at COP27 to launch.

9-10 September (Saturday-Sunday): G20 summit, New Delhi, India.

15 September (Friday): IMF to review USD 3 bn program.

19-20 September (Tuesday-Wednesday): Federal Reserve interest rate meeting.

21 September (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

21-23 September (Thursday-Saturday): Narrative PR Summit, Somabay.

25 September (Monday): Nasdaq deadline for Swvl Holdings Corp to increase its market value of publicly held shares to a minimum of USD 15 mn.

26 September (Tuesday): Prophet Muhammad’s birthday (TBC).

28 September (Thursday): National holiday in observance of Prophet Muhammad’s birthday (TBC).

OCTOBER

October: Deadline for ins. providers to link their databases with the FRA.

2-5 October (Monday-Thursday): ADIPEC 2023, Abu Dhabi National Exhibition Center.

6 October (Friday): Armed Forces Day.

13 October- 20 October (Friday-Friday): The sixth edition of El Gouna Film Festival (GFF).

Late October-14 November: 3Q2023 earnings season.

26 October (Thursday): Daylight saving time ends.

31 October - 1 November (Tuesday-Wednesday): Federal Reserve interest rate meeting.

NOVEMBER

November: Cairo to hostIntra-African Trade Fair.

2 November (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

15-24 November (Wednesday-Friday): Cairo International Film Festival, Cairo.

DECEMBER

12-13 December (Tuesday-Wednesday): Federal Reserve interest rate meeting.

21 December (Thursday): Central Bank of Egypt’s Monetary Policy Committee meeting.

EVENTS WITH NO SET DATE

2023: The inauguration of the Grand Egyptian Museum.

2023: Egypt will host the Asian Infrastructure Investment Bank’s Annual Meeting of the Board of Governors in 2023.

Summer 2023: EGX to launch a shariah-compliant index.

1H 2023: GAFI roadshow set to launch to drum up foreign investment for golden licenses

1H 2023: Abu Dhabi Islamic Bank intends to launch a digital consumer finance company

2H 2023: Egyptian government expected to sign agreements with a consultant for the EuroAfrica electricity interconnector.

2H 2023: President Abdel Fattah El Sisi and Turkish President Recep Tayyip Erdogan expected to hold a summit.

4Q 2023: EGX to launch its new futures exchange.

End of 2023: A Developments’ first phase of the Lazoghly development completed.

November 2024: Egypt to host the 12th session of the World Urban Forum (WUF12).

2Q 2025: Safaga Terminal 2 to initiate operations.

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